About the document

The beginning of the First World War saw a decrease in import and export between Latin America and Europe, both ways. The Latin American countries did not bow down to Europe, despite the financial pressure that was exerted by Germany, through its financial networks. Most Latin American states remained opposed to pan-Germanism, as they were influenced by the ideals of the U.S.A.

When the US entered the war in 1917, the Latin American countries followed the U.S, and fought alongside the U.S. During the war, many countries in Latin America experienced real prosperity, in terms of high growth, modernization, and trade, along with swelling trade surplus. Brazil, Argentina and Chile were three countries that experienced excellent growth.

When the war ended, these nations started attracting investments from the European nations as well. There was a marked development in the industrial sector, textile, and food industry. This era also marked the beginning of heavy metallurgy, mechanical engineering and automotive industries. Ford and General Motors set up their branches in Brazil, which boosted the nation's economy. Meanwhile, agricultural products, and extraction of mineral resources increased dramatically. Wheat production in Argentina increased by at least 50% at the end of the war, with wool and Brazilian coffee increasing by 48%. The production of rubber and Mexican petroleum increased ten fold. The war saw the beginning of the exploitation of Venezuelan oil. Trade flow was genuinely reoriented. The share of the USA had increased significantly, and this was maintained after the war.

In 1919, Mexico imported about 70% goods from the U.S, and exported about 78% goods. Latin America had entered the orbit of the USA, along with South America. Despite this, it kept up links with Europe, in terms of investing on a few things, for example, Brazil preferred buying coal and Cork from Pittsburgh. Nations in Latin America preferred Standard Oil to the oil from Shell. However, this growth was fragile and uneven. The crisis of 1920-1921 reversed almost everything that had been experienced by South America until 1924. Growth decreased substantially. The trade surpluses also declined, and this gave rise to the resurgence of trade deficit. Social differences increased, especially between the cities and the countryside. On the political front, tensions manifested themselves in the form of violent movements, strikes and student unrest. These movements were severely repressed, but they contributed to the emergence of leaders. The media also played a great role in admiring these movements and the emergence of leaders.

The war confirmed the dependence of Latin America vis-a-vis the USA, as they engaged in war, their exports to this region had fallen and then the traffic of the port of Buenos Aires was seen to collapse to 2 / 3 between 1939 and 1943 with a lack of oil, energy and manufactured goods. Industrialization was meant to meet those needs of the USA and then the export was back up with the trade balance in surplus and with a significant investment in the industry. In 1945 there are real industrial areas around major cities like Mexico City, Monterrey, Rio de Janeiro, Sao Paulo, Buenos Aires or Santiago. Balance of payments was in surplus, prosperity was such that large countries were lending to countries like France.

Tags: Latin American countries; industrialization in twentieth century; between development; independence and dependance